Jackson et al v. The Aliera Companies Inc et al, No. 2:2019cv01281 - Document 67 (W.D. Wash. 2020)
Court Description: ORDER granting Plaintiffs' 40 Motion for Leave to File a Second Amended Complaint. Signed by Judge Barbara J. Rothstein. (TH)
Download PDF
<![CDATA[
Jackson et al v. The Aliera Companies Inc et al Doc. 67 Case 2:19-cv-01281-BJR Document 67 Filed 07/07/20 Page 1 of 8 1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF WASHINGTON AT SEATTLE 8 GERALD JACKSON, ROSLYN JACKSON and DEAN MELLOM, 9 Individually and on behalf of all others Similarly situated, 10 Plaintiffs, v. 11 12 13 14 15 ) ) ) ) ) ) ) ) ) ) THE ALIERA COMPANIES, INC., a ) Delaware corporation; ALIERA ) HEALTHCARE, INC., a Delaware ) Corporation; TRINITY HEALTHSHARE, ) INC., a Delaware corporation, ) ) Defendants, ) ____________________________________) CASE NO. 2:19-cv-01281-BJR ORDER GRANTING PLAINTIFFS’ MOTION FOR LEAVE TO FILE SECOND AMENDED COMPLAINT 16 I. INTRODUCTION 17 Plaintiffs Gerald Jackson, Roslyn Jackson, and Dean Mellom (“Plaintiffs”) bring this 18 putative class action suit against Defendants Aliera Companies, Inc., including its now-defunct 19 subsidiary Aliera Healthcare, Inc. (collectively “Aliera”), and Trinity HealthShare, Inc. 20 (“Trinity”). See First Am. Compl. (“FAC”), Dkt. No. 16. Plaintiffs allege that Defendants sold 21 them unauthorized health insurance plans (“AlieraCare”) in violation of Washington law; and 22 engaged in unfair and deceptive practices in violation of the Washington Consumer Protection 23 Act, RCW 19.86.010 et seq. See FAC at ¶¶ 17–19; 103; 105. 24 25 1 26 Dockets.Justia.com Case 2:19-cv-01281-BJR Document 67 Filed 07/07/20 Page 2 of 8 Currently before the Court is Plaintiffs’ motion for leave to file a second amended 1 2 complaint pursuant to Federal Rule of Civil Procedure (“FRCP”) 15. See Pls.’ Second Mot. to 3 Am. Compl., Dkt. No. 40. Defendants jointly oppose the motion. See Defs.’ Consolidated Resp., 4 Dkt. No. 43. Defendants urge this Court to deny Plaintiffs’ motion on several grounds. First, they 5 point out that the Court-imposed deadline to amend pleadings has expired. Id. at ¶ 1. Therefore, 6 Defendants argue, Plaintiffs must seek relief from this Court’s scheduling order by bringing their 7 motion pursuant to FRCP 16, not FRCP 15. Id. at 1–2. Defendants claim that this, alone, is a 8 sufficient basis upon which this Court can deny the motion. Id. Next, Defendants argue that even 9 if this Court interprets Plaintiffs’ motion as a FRCP 16 motion, Plaintiffs fail to meet the standard 10 for relief under FRCP 16. Id. Lastly, Defendants contend that if this Court concludes that FRCP 11 15 is the applicable rule, Plaintiffs cannot satisfy the standard for FRCP 15. Id. 12 The Court heard arguments on June 9, 2020 and orally granted Plaintiffs’ motion. Dkt. 13 Nos. 56, 60. The following is the basis for the Court’s decision. 14 II. 15 BACKGROUND This matter has a long factual history, most of which is not relevant to the current motions 16 and will not be restated here.1 It is sufficient to state that Plaintiffs enrolled in Trinity’s AlieraCare 17 plans in 2018 and 2019. See FAC at ¶¶ 86; 95. They filed this suit, on behalf of themselves and 18 the putative class, alleging that Defendants Aliera and Trinity sold them unauthorized health 19 insurance plans in violation of Washington law. Id. at ¶¶ 17–19; 103; 105. These plans, sold and 20 administered by Aliera, provided members with benefits for medical coverage in exchange for 21 their monthly premiums. Id. at ¶ 15. Plaintiffs, all of whom paid their monthly premiums and met 22 their standard deductibles, expected that Trinity would pay their medical claims covered by their 23 1 For a complete recitation of the procedural and factual background of this case, see Court’s Order Den. Defs.’ Mots. 24 to Dismiss at 2–5, Dkt. No. 47. 25 26 2 Case 2:19-cv-01281-BJR Document 67 Filed 07/07/20 Page 3 of 8 1 plans as detailed by the AlieraCare benefits booklet (“Member Guide”). Id. at ¶¶ 31; 93–94; 99– 2 10; see Member Guide, Ex. B to FAC, Dkt. No. 16-2. However, Plaintiffs were each denied 3 healthcare coverage under AlieraCare after submitting their individual claims to Trinity. Id. 4 With t ment). 24 25 26 4 Case 2:19-cv-01281-BJR Document 67 Filed 07/07/20 Page 5 of 8 1 Defendants argue that Plaintiffs and the Perrins have not acted diligently to meet this 2 Court’s the deadlines for amending their complaint and joining additional parties. See Defs.’ 3 Consolidated Resp. at 6. 4 The Court disagrees with Defendants and instead concludes that Plaintiffs have good cause 5 for missing the Court-imposed deadlines. First, Plaintiffs’ counsel demonstrates that they could 6 not have requested to add the Perrins as named plaintiffs any earlier than they did because the 7 Perrins did not contact Plaintiffs’ counsel until January 24, 2020, long after the Court’s deadlines 8 for amending pleadings and joining additional plaintiffs. Next, Plaintiffs’ counsel demonstrates 9 that Defendants delayed Plaintiffs’ ability to obtain information regarding the Perrins, and said 10 information was necessary to file the instant motion. For instance, Plaintiffs served their initial 11 discovery requests on Defendants on February 4, 2020, see Hamburger Decl., ¶ 5, and 12 supplemented their request on February 11, 2020, sending a HIPAA-compliant authorization for 13 release of information to Defendants’ counsel, id. Defendants did not respond with any documents 14 relating to the Perrins until April 10, 2020, more than two months after Plaintiffs’ initial request. 15 Id. at ¶ 7. Lastly, Defendants did not disclose to the Perrins that they had exhausted only the first 16 level administrative appeal until March 19, 2020. See Pls. Motion to Amend., at 5. By delaying 17 the disclosure of this information, Defendants impeded Plaintiffs from knowing whether their 18 request to amend their complaint and add the Perrins was moot. Therefore, the Court finds that 19 Plaintiffs have demonstrated “good cause” under Rule 16’s standard for allowing them to amend 20 their complaint and add the Perrins outside of the Court’s original scheduling order. 21 22 A. Rule 15 Having determined that Plaintiffs have demonstrated “good cause” to modify the Court- 23 imposed scheduling order, the Court now turns to the question of whether Plaintiffs have 24 25 26 5 Case 2:19-cv-01281-BJR Document 67 Filed 07/07/20 Page 6 of 8 1 demonstrated that amendment is proper under Rule 15. See FED. R. CIV. P. 15(a); see also 2 Johnson, 975 F.2d at 608–609 (stating that after a district court finds that a party has shown “good 3 cause” for amendment under Rule 16(b), then the party must then demonstrate that amendment 4 was proper under Rule 15). Rule 15 provides that a party may amend its complaint with leave of 5 the court, which should freely be given when justice so requires. See FED. R. CIV. P. 15(a)(2). 6 When considering a motion for leave to amend, a court must consider the following five factors: 7 (1) bad faith; (2) undue delay; (3) prejudice to the opposing party; (4) futility of the amendment; 8 and (5) whether there has been a prior amendment. See Nunez v. Ashcroft, 375 F.3d 805, 808 (9th 9 Cir. 2004). In conducting this five-factor analysis, the court must grant all inferences in favor of 10 allowing amendment. See Griggs v. Pace Am. Group Inc., 170 F.3d 877, 880 (9th Cir. 1999). The 11 Court will analyze each of these factors in turn. 12 Defendants claim the proposed amendment is unduly prejudicial, futile, and would cause 13 undue delay. See Defs.’ Consolidated Resp. at 7–9. Plaintiffs disagree. See Pls. Motion to 14 Amend., at 6–8. The Court will address each of these arguments. 15 16 i. Undue Delay and Unfairly Prejudice Defendants argue that allowing Plaintiffs’ motion will cause unduly delay in this matter 17 and therefore granting the motion will be prejudicial to Defendants. A district court may deny a 18 motion for leave to amend if permitting an amendment would cause an undue delay in the 19 litigation. See Zivkovic v. S. California Edison Co., 302 F.3d 1080, 1087 (9th Cir. 2002) (citing 20 Jackson v. Bank of Hawaii, 902 F.2d 1385, 1387 (9th Cir.1990)). Although delay is not a 21 dispositive factor, it is relevant, especially if no reason is given for the delay. See Lockheed Martin 22 Corp. v. Network Sols., Inc., 194 F.3d 980, 986 (9th Cir. 1999) (citing Morongo Band of Mission 23 Indians v. Rose, 893 F.2d 1074, 1079 (9th Cir.1990); Swanson v. United States Forest Serv., 87 24 25 26 6 Case 2:19-cv-01281-BJR Document 67 Filed 07/07/20 Page 7 of 8 1 F.3d 339, 345 (9th Cir. 1996)). Plaintiffs’ motion is clearly late as it was filed several months after the deadline for 2 3 amending pleadings and joining additional parties. However, Defendants present no evidence that 4 allowing Plaintiffs to amend their pleadings will unduly delay these proceedings. On the other 5 hand, Plaintiff provide evidence that it is Defendants’ actions that delayed Plaintiffs’ ability to 6 bring this motion by delaying the production of documents related to the Perrins as discussed 7 supra. Once Plaintiffs’ counsel received the produced documents relating to the Perrins, they 8 attempted to promptly confer with Defendants’ counsel about amendment and then brought this 9 motion expeditiously, on the same day. “The party opposing the amendment bears the burden of showing prejudice.” DCD 10 11 Programs, Ltd. v. Leighton, 833 F.2d 183, 187 (9th Cir. 1987). Defendants argue that they “will 12 be prejudiced by Plaintiffs’ new complaint and new party[,]” alleging that counsel will be required 13 to file “new motions addressing the new complaint if Plaintiffs’ motion is granted, which will 14 delay adjudicating Defendants’ motions to dismiss even longer.” Defs.’ Consolidated Resp. at 6, 15 ¶ 4. The Court notes that Plaintiffs’ proposed amendments plead the same claims and the same 16 17 remedies as their First Amended Complaint. Next, little discovery has been conducted to date— 18 largely due to Defendants’ actions—thus adding the Perrins will not require that prior discovery 19 efforts be repeated. Moreover, most if not all of the limited discovery that has been to date is 20 equally relevant to the Perrins.2 Thus, the Court finds that Defendants have failed to demonstrate 21 2 Nor is the Court persuaded by Defendants’ claim that Plaintiffs should be barred from amending the complaint 22 because Plaintiffs seek to attach to the complaint “state agency consent decrees”, “other orders issued without a 23 24 25 26 hearing”, and “website statements of state agencies”. Defs.’ Consolidated Resp. at 8, ¶ 1. Defendants argue that Plaintiffs’ proposed amendment “is nothing more than an improper attempt to reference unduly prejudicial evidence in the Complaint that can never be admitted at trial.” Id. The Court finds this argument unavailing. The consent decrees and other documents simply supplement existing claims in the initial complaint and provide factual support to allegations already made. 7 Case 2:19-cv-01281-BJR Document 67 Filed 07/07/20 Page 8 of 8 1 that allowing the amendment would unduly delay these proceedings and be unfairly prejudicial to 2 Defendants.3 3 ii. Futility An amendment is futile when “no set of facts can be proved under the amendment to the 4 5 pleadings that would constitute a valid and sufficient claim or defense.” Missouri ex rel. Koster 6 v. Harris, 847 F.3d 646, 656 (9th Cir. 2017) (quoting Miller v. Rykoff–Sexton, Inc., 845 F.2d 209, 7 214 (9th Cir. 1988)). Defendants argue Plaintiffs’ proposed amendment is futile because “the Perrins have never 8 9 gone beyond the first tier of the binding dispute resolution process.” Defs.’ Consolidated Resp. at 10 7, ¶ 4. However, this Court has already determined that if the allegations set forth in the operative 11 complaint are proven true, Plaintiffs will not be required to submit to the dispute resolution 12 procedures as set forth in the Member Guide because they are unenforceable under Washington 13 health insurance law. Nothing in the proposed amendment charges this conclusion. The Court finds that Plaintiffs have shown “good cause” for their amendment under Rule 14 15 16(b); and have demonstrated that their amendment is proper under Rule 15. 16 IV. CONCLUSION For the foregoing reasons, the Court hereby GRANTS Plaintiffs’ motion to for leave to file 17 18 a second amended complaint. 19 DATED this 7th day of July, 2020. 20 _______________________________ 21 BARBARA J. ROTHSTEIN UNITED STATES DISTRICT JUDGE 22 3 During the motions hearing on June 9, 2020, counsel for Defendant Aliera noted that Plaintiffs have failed to file 23 their class certification within 180 days of filing their complaint, as required by the local rules. Given Defendants’ previously pending motions to dismiss and the question of binding arbitration, the Court finds valid reasons for 24 extending this deadline. See Transcript of June 9, 2020 Motions Hearing at 20:6–9, Dkt. No. 60. 25 26 8
]]>
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You
should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google
Privacy Policy and
Terms of Service apply.
